The 10-year-deal is being considered as a move by the software giant to shake the monopoly of Google after it was left with a massive dent of 5 billion dollars in the internet business over the last four years.

Grabbing 3.3 points of market share, Microsoft's search engine Bing is already making its mark. The search engine was launched in Jun 2009.

Analysts believe that if Microsoft plans its assault carefully with Yahoo, then it can actually manage to push Google off its throne.

"I think it can work. If they can make inroads in specific target areas, they could have something positive to report," said Kim Caughey, senior analyst at Fort Pitt Capital Group.

In terms of revenue, the companies are fighting for the larger share in online ads. The war includes operating systems and mobile phones too.

Some analysts believe that the deal will not change much, at least for a few years, "It doesn't change much in terms of the competitive dynamics of the industry right away," said Clayton Moran, an analyst at The Benchmark Co, adding "From a Google perspective, looking out over the next couple of years, it's a nonevent."

While Microsoft's official statement was on the goal of 'share gain', Google did not comment specifically on the deal.

However, the market seems to be in favour of the deal as it would provide a strong competition and a viable challenge to Google.